- NZD/USD’s daily chart shows an inverse head-and-shoulders breakout.
- The breakout is backed by bullish readings on key indicators.
NZD/USD jumped 1.32% on Monday to print the biggest single-day gain since Nov. 1, 2018. On that day, the pair had rallied by 2%.
Monday’s solid rise has confirmed an inverse head-and-shoulders breakout on the daily chart.
The bullish reversal pattern has opened doors for 0.6744 (target as per the measured move method). On the way higher, the pair may encounter resistance of the 200-day average at 0.6544.
The bullish case looks stronger with the relative strength index reporting an above-50 reading. The MACD histogram is also offering bullish signal with higher bars above the zero line.
The path of least resistance will remain to the higher side as long as the pair is holding above the neckline support (former resistance) at 0.6473.